The tea parties in April were well-publicized events attempting to draw attention to the high tax rates in the United States and they sure didn’t do a very good job of it. Most people went, waived their signs around,applauded speakers and were very patriotic before returning to their real lives of going to work and paying taxes. In other words, they weren’t very serious when they said they were upset at the high levels of taxation and government spending in the U.S.
But what if you really are upset and are looking for a way to opt-out of mandatory taxes? Obviously, you can’t just stop paying them. I mean, you could, but since you’re not a high-ranking government official, you’d actually go to jail. But there are certain things you can do to avoid paying taxes and are perfectly legal.
1. Excise Taxes
Excise taxes are taxes levied on specific items; consequently, they are very easy to avoid. All you have to do is stop buying those items. Stop smoking. Barring that, grow your own tabacco for personal use. An advantage of doing so is that tabacco water is a natural pesticide. Stop drinking, or better yet, brew your own liquor. Quit driving so much and either carpool, walk or ride a bike. Remember 0-2 miles is walking distance, 2-10 miles is biking and anything above that is driving distance. This should dramatically cut down on the gasoline tax you pay.
2. Sales Tax. Obviously, no one can completely stop buying stuff, so this tax is harder to avoid. Most Americans can, however, decrease the amount of things they do buy. There’s an old saying that says “Use it up, wear it out, make it do or do without.” This is a great way to avoid sales tax. Instead of buying a new pair of shorts when one rips, sew it up or patch it. Buy used, at garage sales or thrift stores. While you might still pay some tax, it will be less than if you bought new items. Do your shopping in states with no sales tax or a lower sales tax. In New England, this means driving to New Hampshire. If you live in Wichita, KS, it means doing your shopping outside of Sedgwick County, which has a ridiculous sales tax to fund their stupid arena. Grow as much of your own food as possible. While some states have a lower sales tax on food, a tax is still a tax and most people have a bit of land they can use for food growing purposes. It also tastes better.
3. Income Tax. This one is still harder to avoid. Unlike a lot of people, I recommend always filing your income tax return, for several reasons. First off, while you’re not required to file it if you earn under $5,000 a year (or has it gone up now?), they still withhold income tax from that amount and you won’t get it back unless you file. When I was a poor college student earning very little, I filed and they sent me a check for around $13. If your goal is to impoverish the government, making them review your law-abiding income tax filing and then pay to mail you a check is definitely worth it because they lose money on the scheme. Other than that, maximize your deductions. Ever wonder why the rich don’t protest much when the government raises taxes on the wealthy? It’s because they deduct so much, they never pay close to the percentage the government pretends they are. I’ve heard forming a LLC is a great way to do this, but I’m not a tax accountant so don’t take my word for it. Other than that, seek to minimize your income. I know, most people want to maximize it so they can be rich, but what’s the point if earning more just means you have pay more of your income to the government? Ideally you should seek to earn at a point where your deductions are maximized and your taxes minimalized, but if you want to get really extreme, you can set up your expenses so that you can get by as little money as possible. This means having no debt, and in all likelihood followin the advice outlined in the first two sections: grow or make everything yourself as a sort of modern day Thoreau. It’s extreme, but I know people who do this and who pay no taxes. There are also other taxes, such as a capital gains tax, that are closely related to income taxes but are easier to avoid. If you don’t want to pay capital gains tax, don’t invest.
4. Property Taxes. The hardest to avoid, property taxes mean that you are rent to the government for the right to continue living on your private property. If you don’t believe me, stop paying them. Just like a landlord whose tenants have stopped paying rent, the government will evict you. There really is no way to get around it, but you can minimize it by owning minimal property, owning marginal property (say, property located next to an airport, railroad track and highway), and doing very little to improve your property. Unfortunately, this might hamper your ability to become self-sufficient and avoid paying other taxes. You could always rent, but then you just pay property taxes indirectly via rent to your landlord. I guess living in your car would be a reasonable solution, but you pay taxes on it, too, in order to register it. Several homeless camped on some islands in the middle of the Merrimack in tents, so I suppose that’s one solution.
Does all this seem a little crazy to you? A little extreme? I mean, come on, who would go to those lengths to just avoid paying taxes? And, what about all the good that comes from paying taxes? The gas tax pays for our roads, for example, the property tax is for education and the income tax does everything else!
Oh, I’m sorry…you mean, the gas tax we pay despite the fact our infrastructure is crumbling and government continuously uses that money to pay for other stuff? You mean the property taxes we pay so that we can spend $8,000 a year pretending to educate children, who still remain ignorant? And the income tax? Is used to pay interest on our national debt. As far as getting all the bang for our buck, American tax payers have been royally screwed.
Taxes we pay are not being used to provide valuable services for the people. They’re being used to invade other countries and to bailout Wall Street. What we don’t pay in taxes today, we’ll pay in taxes tomorrow in the form of money our government is borrowing from other countries. Governor Meldrim Thompson of New Hampshire was fond of reminding everyone that low taxes are the result of low spending. Remember that the next time you’re at a Tea Party or the next your government insists that all they have to do is spend a few billion more dollars and the economy will be hunky dory again.
